I asked a question on the My Total Money Makeover member website community forum. It was a simple question, “Which debts go in the debt snowball? I remember Dave Ramsey saying something about any debt that is over half you annual income doesn’t go in the snowball”.
I did remember correctly. Debts over half your annual income go in baby step 6, not in baby step 2. That will help me out on the 3-5 highest debts I have, and the 3 that are running up interest at the greatest rates as well. Now that I know they go in baby step 6 I have to find out what to do to stop paying on them right now. But I’ve been too scared to ask another question on the forum.
When I started getting replies to my questions I got a question back from one member asking me very nicely if I would share the details of my situation and that said member also reads this blog. So I gave it a little thought and decided what the heck, this member has real life experience in business debt and self-employment. And said member was very helpful.
What I didn’t consider about opening up my financial closet full of skeletons is other members are going to read the post and comment on it as well. Being a member forum helping each other means people generally answer questions from their own perspective. This means they will say things like “I’ll try to be kind” (translation, I’m going to be just slightly less mean than usual), “from your reply it doesn’t sound like you’re committed to the plan” and “you haven’t made the BIG changes you need to make”.
In my current financial and mental state, saying things like that to me is like waving a red flag in front of a very angry bull. I exploded in writing and got back replies chastising me for being so angry. I apologized about ranting on and blowing up, and more people wrote back with encouraging words instead of advice.
But still, even if you put your private life on display in a member forum to seek help you shouldn’t get kicked for it - that’s how I felt and how I still feel. You either shouldn’t have done it in the first place (wisest choice), or people who comment on forums as emotionally charged as the My TMMO forum should be a lot more gentle about what they say to others. Not everyone is looking for an accountability slap, or advice that doesn’t really apply to them.
For example, those who have never run a small business should not comment about small business and self-employment issues unless they are there to be supportive of anyone in a desperate heap of trouble. I’m not going to get on the forum and tell someone I don’t know that they aren’t committed. I don’t know them or their situation.
Maybe I’ve had too much therapy, but if someone asked me if they were committed enough, I’d probably say back to them “I don’t know, do you think you’re committed enough?” Most people are going to be tougher on themselves than anyone else. Unless someone really reads your detailed post and understands your world from their own personal experience, they are not able to give you advice worth having.
Why should you listen to anyone giving advice on the forum? They’re broke! (This is an inside joke from the MyTMMO forum. One of the avatar captions you get is “Don’t give me advice. You’re broke!”).
I wish I had the debt problems of 90% of the people on that forum. I could manage their debts easily on what I make. I’d gladly trade with nearly anyone of them.
I’m frighteningly close to bankruptcy and I’m just trying to figure out a way to avoid it. I figured that out when I was preparing my last debt report post. I’m paying $1000/mo on the debt and it’s going up $1500 or more per month above that. I now realize there isn’t a way to deal with this by reading a book and following a cookie-cutter plan.
My only hope is to start making substantially more than I’m making now and get professional help with restructuring my situation so it’s manageable in the short-term. High income doesn’t just fall in your lap. It takes work to find work. It takes a lot of work to find high enough paying work. It takes time along with a lot of work to develop a high-paying income stream doing something you love. It takes soul-searching, time and a lot of work to figure out what you love.
I have a copy of “48 Days to the Work You Love” by Dan Miller on the way free shipping from Amazon. I’m earning as much as I can doing whatever right now, but I’ve got to find a plan to be doing what I love making what I want to make in 5 years or less. If I don’t find a passion to turn into a profession, I’ll doom myself to the corporate world of industrial chemistry and face getting laid off about every 3 years or so. That’s assuming I can ever find another job as a lab chemist. They just don’t seem to be around here anymore. It’s not that being a chemist isn’t great. I love it. But many manufacturing jobs here are going to places like Mexico, China and South America where labor is cheap and environmental laws aren’t such a pain (yet).
I plan to call the Dave Ramsey professional counselor team Monday or Wednesday. I don’t know if they will be closed Monday, New Year’s Eve. I tried working with the only local DR counselor, but he didn’t have the knowledge or experience to help me. He didn’t even look at my numbers before he told me I wasn’t bankrupt. He would have been right 90% of the time. With me, he is more than likely wrong, unless some restructuring will really help buy me some time until I can get my income up.
I’ve gone through every financial item I have on my budget and worked out the expenses without the unsecured debt payments in an Excel spreadsheet, so I’m ready to provide timely and detailed information to whomever I work with. I have it printed and ready to fax.
When I did the budget for January 2008, I managed to get expenses down to $3300 from $3700 in December. There may still be more to cut. I hope so.
I learned some valuable lessons:
- Don’t give out personal details without a guarantee of confidentiality. It will likely be used as ammunition against you by some schmuck who thinks because they’re doing X, it applies to everyone else.
- Don’t seek advice from amateurs when you need a professional.
- Get answers to specific questions a readership or listener-ship will be able to answer factually. But don’t tell your detailed story even if asked.
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December 29th, 2007
Posted by
joubess |
Baby Steps |
2 comments
Debts Paid in Full Report
- Debts paid in full: 5
- Amount paid in full: $2,659
Status Report:
- December 2007 payments: $999.99 (no joke, that’s what I really paid)
- Total amount of payments made to date: $5932
- Debts left to pay off: 12
- Next debt in line: at&t advertising and publishing: $770.66
Balance Report:
- Current Debt Balance: $163,924
- Balance change since last month: -$1,467 (increase)
- Balance change since starting the plan (April 2007 plus the principal on new debts that have come up since): -$4,378 (increase)
Peering At Possibilities
I’m facing an income crisis if I want to pay off my debts in a reasonable number of years.
If I wanted to pay all this off in 5 years from today, it would cost $32,784/year or $2,732/month.
If I wanted to pay all this off in 3 years it would cost $51,641/year or $4553/month. I can forget that for right now. Maybe I’ll be here later.
Those figures don’t include the interest charges and fees, the first and second mortgages on my house or the SBA loan.
Our minimum (bare bones) expenses are $3,700/month. I’m working on reducing this some more. I think the grocery budget can be decreased, but we don’t spend anywhere near $2,732/month on groceries.
That looks like trying to use a squirt gun to put out a house fire. Damn. I’m the poster child for doing stupid with zeros on the end.
Making Possibilities Probable
So, with $3,700 in living expenses and $2,732 in debt payments, I need to bring in $6,432 after taxes. That means about $8,362 gross income per month.
Wow. I’ve never made that much before, but I’m going to learn how to do it and more. Dave (Ramsey) says it’s easier to make your second million dollars than your first million because you’ve done it so you know how to do it again. You never forget how to ride that bicycle.
I really, really think there will have to be some settlements for pennies on the dollar if I’m going to make this go away in a reasonable amount of time. I can clearly see I’m not ready to make any debt pay-off goals yet.
I’m looking around my office right now and mentally taking inventory of more stuff I can sell. I can see three medium-sized boxes of stuff just at a glance. I wonder what I’ll find when I dig around?
Anybody out there need a math or science tutor? I’m available!
Back to looking at the front of the snowball
Okay, that’s depressing.
I’m going to keep looking at the front end of the snowball and work to increase my income as much as possible as fast as possible.
I’m going to keep taking one bite at a time and forget I’m eating an elephant.
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December 22nd, 2007
Posted by
joubess |
Debt Reports |
one comment
I think I’m just as excited as my students that mid-terms are over. I feel like I used to at the end of final exams in college — totally wiped out.
I have 14 students and 7 subjects. I’ve been putting in over 20 hours per week, which is a lot tutoring. Teachers generally teach 6 hours out of 7 and only one to a few subjects. I also have no benefits, but I love the flexible schedule. It allows me to have a business and blog.
I love tutoring, though, because I get to work one-on-one with my students and when they succeed at something that’s been hard for them I’m so proud of their progress. Sometimes they credit me for their improvement, but it’s not me that’s doing the improving. I’m only helping them to understand their subject better. They do the learning and the work. It’s their success. I can tutor and help a student from now until doomsday, but if that student doesn’t want to improve, he or she won’t improve. So when a student improves it’s because they learned from me and were able to apply that new skill or knowledge to perform better in class and on tests.
It’s the greatest feeling in the world when something you do makes such a big difference in someone else’s life. No amount of money could cause that feeling.
However, I do have to make a living. My current pay rate is $19/hour, so this month I will bring in about $1170. It may be a little more because I’m working with a student who is catching up over the break due to a hospitalization. I’m not sure how many hours we’ll get in before the end of the month.
I’ll also be getting a refund from my divorce attorney from a couple of years ago for a medical payments reimbursement issue I was facing. I’m not sure how much that will be, but I’ll take it. My ex and I worked out our own deal to reimburse me for out-of-pocket medical expenses based on our original support agreement and I didn’t need to have my attorney involved. All she ended up doing for me was writing a letter to get the ball rolling.
That’s really the best way to do it. By now we’ve been divorced long enough to be able to talk things out concerning our son without a court having to be involved. We learned that whatever we do, it has to be in his best interest, so we’d better figure that out and live by it, and we can do it on our own. I think we’ve finally learned how to be grown-ups about dealing with joint custody issues. We have our disagreements, but we’ve agreed to disagree, we don’t discuss those issues unless we have to, and we work it out from their.
I’ve got to get my blogging earnings up. I’m about to do lesson two of the Blog Mastermind class I’m taking. I’m also going to finish my home office organization project and then sell that blog because I just don’t have enough passion to keep writing about it. I’m also selling my red beans and rice recipes blog. There are a lot of other people out their much more suited to those topics than I am. If any of you, my readers, are interested in those two topics, I will be learning how to value their current content soon, and I’ll be putting a sales price on them.
I haven’t decided what I’m doing with my Invader Zim Episodes blog. I have been able to post to it somewhat regularly, and I really do love the show. I only wish it came on more often.
The blogs I’ll be keeping and posting to regularly are:
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December 21st, 2007
Posted by
joubess |
Career, Earnings Updates |
no comments
I’m working 3 jobs right now because I’m putting every extra dollar on my debt. I’ve been neglecting my family, too (meaning my mom and sister, not my son). But, they will be there when I can stop working like a crazy person.
On to my story…
We had our annual December birthday celebration tonight at the our local hang-out bar. I had a blast and the cake was my favorite — chocolate! Five of our group have December birthdays.
I’m at the age now where I get the “drinking age verified” wristband without being carded. I’m the second oldest of the group. The oldest is only 6 months older than I am.
I am upset that I wasn’t invited to the dinner before the party at the bar and my name wasn’t on the cake this year, a sure sign that being out of site is being out of mind. It’s my own fault. I even forgot this month was my birthday until I was invited to the birthday party for the others, so if I forget, I guess I can’t really expect anyone else to remember. It’s ironic because I just wrote an article about the value of our attention on my TDC blog, and I’m guilty of not giving my friends enough time and attention to fully include me in the birthday celebration.
I was good (financially). I only spent $10 tonight, and I had $30 in the budget for the special occasion. That extra $20 is going on the debt. I spent $10 on my own cover charge and I bought my own diet Cokes. My friends were buying the drinks (thank you!). I don’t drink much alcohol, so buying me a drink is pretty insignificant comparatively.
I am off to bed. I’m very sleepy and it’s very late. I have to be at the library tomorrow this afternoon at 2 for 5 hours of tutoring. My students have mid-terms this week and are cramming sessions in where ever they can. Come on Thursday! My last heavy work night will be Wednesday before the last day of tests on Thursday. Then I can focus on reconnecting with my family and friends and blogging for a few weeks before school starts again.
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December 16th, 2007
Posted by
joubess |
Off Topic |
2 comments
This post is a short report of what I accomplished in November compared to October 2007.
Earnings:
- Adsense: Nov. $9.86; Oct. $0.56 % increase: 1761%
- Amazon Associates: Nov. $0.40; Oct. 0.58 % decrease: 31%
- Commission Junction: none both months
- Clickbank: none both months
- Associated Content: none both months
Subscribers (November only):
Number of Site Visitors (November only):
Right now I’m using the number of site visitors to measure activity. I’m not sure if I should be using that number or page views. I also want to get my sites’ stickiness up to at least 2 minutes on average. If you are interested in the site’s content you will stay around longer to read or view what’s there.
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December 3rd, 2007
Posted by
joubess |
Career, Goals |
no comments
